Market Overview

Back to Work Wednesday

Back to Work Wednesday

Forget the insurance companies.

Yesterday they were saying $20Bn in damages but the NYC subway system alone may have more than $20Bn in damage.  Who's insuring it, I have no idea, but things like that and the devastation along the Jersey shore, where single homes are worth well over $1M and 100 miles of home-filled coastline was hit with record flooding means we could, ultimately, be looking at $50-$100Bn worth of total (not all insured) damage from hurricane Sandy.  

So we're not going to go bargain-hunting for insurance companies – it's a very hard group to pick winners and losers in but some segments, like title insurers, tend to sell off with the group – even though they don't even write that kind of insurance – and those can make for some good fishing once the dust settles.  

At the moment, the futures are up slightly (8am), but only because the Dollar took a dive to 79.75 as the Euro broke over $1.30 but it remains to be seen if the Dollar will stay under 80 and the Euro will stay over $1.30 – otherwise we'll be back on the downward path very quickly.  The oil inventory report has been postponed until tomorrow and oil is back up at $86.35 but, with 1/3 of the country not driving or flying for a few days – don't expect a lot of fuel to be used in the NEXT report – this one only covers through Saturday.

Over in Europe, Unemployment remains stubbornly high at 11.6% for September, up from 11.5% in August with both Spain and Greece topping 25% unemployment.  Spain, for it's part, seems to have narrowed their deficit to 4.39% of GDP from 4.77% just a month ago, mainly on an increase in VAT taxes doing their trick and increasing revenues for the Government (but didn't Romney say that raising taxes would lower revenue – was he lying or just completely wrong?).  The 5% drop in the deficit in the first month of a tax increase bodes very well for Spain and gives credibility to the Government's resistance to the EU bailouts and their draconian terms (ie. the Paul Ryan budget).  






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